NeoStem Completes $11 Million Private Placement Financing to Support Expansion
Activities in China, Further Development of NeoStem's VSEL Technology and
Advancement of Medical Tourism Initiatives
NEW YORK, Apr. 13 /PRNewswire-AsiaNet/ --
NeoStem, Inc. (Amex: NBS) announced today that it has completed a private
placement financing totaling $11 million from three Asia-based investors,
including a private equity firm operating in partnership with strategic
investors drawn from leading Asian families and businesses.
The financing consists of units priced at $12.50 per unit, with each unit
consisting of one share of the Company's Series D Convertible Redeemable
Preferred Stock and ten warrants each to purchase one share of common stock
(resulting in an equivalent price of $1.25 per common share plus an attached
warrant). The warrants have a per share exercise price equal to $2.50 and are
callable by the Company if the common stock trades at a price equal to $3.50.
Subject to the affirmative vote of the Company's shareholders and the rules
of the NYSE Amex, the warrants will become exercisable for a period of five
years and each share of Series D Convertible Redeemable Preferred Sock will
automatically convert into ten shares of Common Stock.
The investing firms are RimAsia Capital Partners, LP, a pan-Asia private
equity firm operating in partnership with a regional network of strategic
investors drawn from leading Asian families and companies, investing $5
million; Enhance Biomedical Holding Corporation based in Shanghai, also
investing $5 million and Elancrest Investments Ltd., a Singapore-based firm,
investing $1 million. RimAsia Capital Partners previously invested $1.25
million in NeoStem, as was announced on September 3, 2008.
The funds will be used to support the development of NeoStem's VSEL (very
small embryonic-like stem cells) technology licensed from the University of
Louisville and help advance NeoStem's expansion activities in China,
including those relating to its pending acquisitions and medical tourism -
defined as travel by people whose primary and explicit purpose is to access
in a foreign country medical treatment not yet available in their own nation.
Through its connections with leading physicians in China and the U.S.,
NeoStem expects to connect U.S. citizens with advanced therapies not yet
available in the U.S., and attract people from other countries to seek safe
and effective regenerative therapies as they become available here. A portion
of the funds also will be used to expand U.S.-based operations. In addition,
a portion of the proceeds will be used to repay $1,125,000 in bridge
financing received from RimAsia Capital Partners, LP in February and March,
interest on the bridge financing and other costs advanced by RimAsia in
connection with the Company's expansion activities in China.
Dr. Robin Smith, Chairman and CEO of NeoStem, stated, "We are extremely
pleased to receive this substantial investment from a group of highly
respected investors in Asia. Our relationships with our business partners in
China continue to deepen as we recognize increasing areas of synergies among
our innovative stem-cell technologies, products and services, and business
models. When these acquisitions are completed, we anticipate NeoStem will
benefit greatly from expanded new markets, distribution channels and
production capabilities for a growing pipeline of regenerative drugs and
procedures offered in the world's two largest economies."
Eric Wei, Managing Partner of RimAsia Capital Partners, LP said, "We are
extremely optimistic about the growth opportunities for NeoStem based on its
multi-pronged plan to capitalize on a growing PRC-based network. We are glad
to be joined by other investors in Asia who recognize the huge market
potential for stem cell therapies in the PRC, a field in which breakthroughs
are developing at an accelerating rate."
The securities sold were sold without registration under the Securities
Act of 1933, as amended (the "Act") pursuant to Regulation S and Regulation
D, each promulgated under the Act and may not be resold in the United States
or to U.S. persons unless registered under the Act or pursuant to an
exemption from registration under the Act. Hedging transactions involving
such securities may not be conducted unless in compliance with the Act.
About NeoStem, Inc.
NeoStem is managing a network of adult stem cell collection centers in
major metropolitan areas in the United States, enabling people to donate and
store their own (autologous) stem cells when they are young and healthy for
their personal use in times of future medical need. The Company also has
entered into research and development through the acquisition of a worldwide
exclusive license of technology to identify and isolate VSEL(very small
embryonic-like) stem cells, which have been shown to have several physical
characteristics that are generally found in embryonic stem cells.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning
of the Private Securities Litigation Reform Act of 1995, including, without
limitation, statements regarding the Company's expansion activities in China
and the future for the commercial use of stem cell therapies and the
Company's VSEL technology. Forward-looking statements reflect management's
current expectations, as of the date of this press release, and involve
certain risks and uncertainties. The Company's actual results could differ
materially from those anticipated in these forward-looking statements as a
result of various factors. Factors that could cause future results to
materially differ from those projected in forward-looking statements include
the "Risk Factors" described in the Company's Annual Report on Form 10-K for
its fiscal year ended December 31, 2008 and the Company's other periodic
filings with the Securities and Exchange Commission. The Company's further
development is highly dependent on future medical and research developments
and market acceptance which are outside its control.
Contact:
NeoStem, Inc.
Robin Smith, Chief Executive Officer
T: 212-584-4180
E: rsmith@neostem.com
SOURCE: Neostem, Inc.
CONTACT: Robin Smith, NeoStem, Inc., Chief Executive Officer,
+1-212-584-4180
rsmith@neostem.com
(NBS)
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